To get a buy to let property as my first property?

[SalIy]

Hi,

I am in a odd position. I cannot afford to buy a home to live in myself as my income is too low and I won’t get a mortgage approval. No partner to combine salaries with. However, according to online mortgage brokers, I can get a buy to let mortgage.

I am currently living with my parents and have a large deposit saved. The property I am looking at will give me £1,200 p/m before expenses which would be a nice earner.

On the other hand I never saw myself as a buy to let landlord. I also think the whole situation is perverse in that I can get a buy to let mortgage but not one to live in myself - despite it being cheaper than I would pay if I were renting (I could have a massive rant about the state of our housing crisis!).

I would also lose any first time buyer benefits for when/if I ever buy my own home eg stamp duty relief, Help to Buy etc.

So I am letting the good women of MN stress test my idea - am I daft to even be contemplating this?

YABU - you sound daft and clearly haven’t thought this through

YANBU - potentially a good investment

Potentially a good investment, but you have no experience of owning and letting

I knew people in London who bought houses and could not afford to live in them and did this. If the numbers work, go for it. Just run your numbers multiple times, get some insight into how much you would put aside each month into an account for expenses, maintenance, upkeep, repairs etc and how much you'd actually make after paying the mortgage down (and whether you'd be repaying on an interest only basis or interest and capital).

We did exactly this. We're now finally moving into it it's quite expensive to switch the mortgage over if you want to do it this way but it was the only way we could get on the ladder.
Definitely get an estate agent to manage it-they don't charge that much and it makes it much easier.

Thanks everyone for your insight. It’s much appreciated. It’s interesting to hear your first hand perspective @DemBonesDemBones. House prices are rising so fast I worry if I’ll ever getting on the house ladder as this rate…

Yes, I guess I may be in over my head given I don’t have any experience of owning and letting property but nobody does when they first start I suppose?

The property I am looking at is only 15 minutes from my work so should be easy to get to if there are any issues. (And in my industry everyone works in the same square mile so this unlikely to ever change much.)

@SalIy you don't really need experience-as you say everyone starts somewhere and you can employ an agent to manage the property and even an accountant to do your taxes. We haven't found it difficult.

Twenty-odd years ago this was how we bought our first house. We got a buy-to-let mortgage, but never rented it out, we just moved in. It was a way of circumventing the affordability multiples, and was still cheaper than us renting. I don't know if that's an option any more. I think most buy-to-let mortgages nowadays forbid you from taking up residence yourself.

It's a great idea. How enterprising. Mumsnet doesn't like landlords however so don't be too disheartened by the poll results.

My advice (as a BTL owner) is to do you sums carefully.

• you won't get rent every month (void periods)
• maintenance costs
• insurance
• tax! Especially if it takes you between tax brackets
• management costs if you use a professional. (Maybe worth if its just the first ding a tenant service, they do the background/affordability checks)
• potential for bad tenants

Its a long game.

It sounds a good idea in theory however I would advise going to see a mortgage broker face to face as there are very few (if any) mortgage companies that will offer a mortgage on a BTL basis for a first time buyer….. most lenders insist you are a homeowner so double check

I know nothing about these things but can you rent it from yourself?